Best Ways to Repair a Bad Credit Report

Best Ways to Repair a Bad Credit Report

Regardless if we understand it or not, our credit report has a notable impact on our lives. It’s sort of like our health; we don’t appreciate good health until we lose it. Most people don’t even learn that they have a poor credit report until they apply for a personal line of credit and it’s disapproved. It can come as quite a surprise to some, since even one missed payment that is documented by your financial institution can stay on your credit report for a maximum of seven years.

So, what is a credit report? A credit report is a record that points out details about your financial history with lenders. Recently, credit reports have been overhauled to place greater importance on constructive history such as paying your bills on time, but overwhelmingly, credit reports are used by creditors to examine your ability to repay debts by assessing your past behaviour.

When creditors inspect your credit report, you generally either get a pass or fail so any default irrespective of its severity can have a long-lasting effect on your financial opportunities for years to come. Although finding solutions to improve a poor credit report can be tough, there are various things you can do to enhance it. The good news is, we’ve assembled a list of recommendations that you can try to enhance your credit report and your general financial health.

Check your credit report for any oversights

The first step is to inspect your credit report to find out exactly what it features. You can do this by paying a modest fee to a business like ‘Check My Credit File’ (https://www.mycreditfile.com.au). It’s not rare for errors to be made on credit reports which can have a detrimental impact on your financial abilities. Read your credit report meticulously and challenge any errors that you find to make sure your credit report appropriately mirrors your financial history. Some common mistakes that can occur are:

Mistakes in personal details

Wrongful defaults and judgements

Old defaults and judgements

Inaccurate information concerning your credit history

If you unveil any errors, notify the credit reporting agency in writing so these listings can be modified or removed to emulate your true credit history.

Pay your bills on time

Lots of people underestimate how vital it is to pay your bills on time. Sometimes, individuals can be forgetful simply because they have too many bills to pay, so it’s a smart idea to call all your lenders and ask them to automatically debit your bank account each month. Often, your creditors would be more than happy to do this as posting paper statements is time-consuming and costly. By placing all your bills on autopilot, you can be certain that they’ll be paid in full and on time, which will have a positive impact on your credit report

Add additional information to your credit report

There are particular details within your credit report which creditors will view favourably. For instance, if you are married, have been employed by the same workplace for over two years, or you are a homeowner, then this information will improve your credit report. Creditors generally view this information in a positive light and it can help you in future credit applications. If you find that this kind of information is missing from your credit report, alert the credit reporting agency and request that it be provided.

Avoid excessive credit applications

Each time you apply for a line of credit, it is recorded on your credit report. Naturally, excessive applications for credit will have an unfavorable effect on your credit report and the way in which creditors view your financial behaviours. It is vital that you are vigilant and selective when requesting credit and only apply when you are confident it will be approved. Moreover, if you recently had a credit application turned down, wait a respectable amount of time before applying again.

Take into consideration a debt consolidation loan

Generally, it can be very challenging to oversee your debts when then you have lots of them. Neglecting just one debt repayment can become a default, which will remain on your credit report for at least five years. Contemplate a single debt consolidation loan which will accumulate all your debts into one, single, monthly repayment. Typically, interest rates on debt consolidation loans are fairly low, and you’ll eliminate any further defaults which will have a positive impact on your credit report. If you’re interested in a debt consolidation loan, talk to our friendly team at Bankruptcy Experts Shepparton on 1300 795 575, or alternatively visit our website for additional information: www.bankruptcyexpertsshepparton.com.au